March 28th Newsletter

Author

Da Yu
March 28, 2025

As of close on March 27, 2025

Markets slowly rebounded this week, yet tariff pressure caused stocks to dip slightly on Thursday. Core inflation from February hits 2.8% exceeding expectations with consumer spending increasing by 0.4%. IPO and M&A activity is showing signs of revival, highlighted by Wiz’s $32B deal and $54.5B in Q1 startup exits. President Trump imposed a 25% tariff on imported cars and parts on Wednesday, while China rejected Trump’s offer to reduce tariffs in exchange for approving TikTok’s sale before the April 5 deadline. Additionally, US factory activity contracted in March as rising tariff-driven material costs weighed heavily on manufacturing output. Additionally, GameStop stock jumped 12% after its Bitcoin investment announcement but dropped post-market on a $1.3B convertible note offering. In tech, Apple is reportedly developing future Apple Watch models with built-in cameras, targeting a 2027 release.

Monthly AI Financing Report: Since January, we started sharing a monthly report of the top AI financing activity gathered from public and proprietary sources. See the latest release of the February update here.

Top 5 AI Highlights

[1]📉CoreWeave priced its IPO on Thursday at $40/share, raising $1.5B—down from earlier $4B targets—amid market volatility. Valued at ~$19B, it marks the largest U.S. tech IPO since 2021. Backed by Nvidia, Microsoft, and OpenAI, the cloud AI firm posted 700% revenue growth to nearly $2B in 2024 but has a net loss of $863M due to capital-heavy infrastructure buildout. The listing tests investor’s confidence following a two-year IPO drought. Shares debut on Nasdaq under CRWV. Details on BBG and CNBC.

[2] 🖼️OpenAI has introduced native image generation in GPT‑4o, offering users the ability to create precise, photorealistic visuals directly through ChatGPT. The system uses autoregressive generation, a new type of image generation. This contrasts with Dall-E models, which use diffusion image generation. 4o image generation handles complex compositions with up to 20 objects and leverages a multimodal model architecture. Additionally, Sam Altman announced temporary rate limits for 4o on X Thursday morning due to excessive overload. Read more from OpenAI, and watch a demo on YouTube.

Source: X

[3]🚀 Perplexity has hit $100M in annualized revenue just 20 months after launching Perplexity Pro, boasting 6.3x YoY growth—excluding all free trials. CEO Aravind Srinivas emphasized this point, seemingly in response to mounting scrutiny of AI sales startup 11x, which faces backlash over inflated ARR, high churn, and misleading customer claims. Meanwhile, Perplexity published a bold vision last week to rebuild TikTok in the U.S., proposing a transparent, open-source algorithm and leveraging its AI infrastructure to power a more trusted, knowledge-rich platform. More on X, TechCrunch, and Perplexity.

Source: X

[4] ⚖️A California judge denied a request by Universal Music and others to block Anthropic from using copyrighted lyrics to train its AI model, Claude, marking a key win for the AI firm. The labels alleged infringement of at least 500 songs, but the court found no immediate harm to reputation or market value. While Anthropic had agreed to guardrails to prevent infringing outputs, it can still train on such material. The ruling comes amid a broader legal backdrop, including a March 18th appeals court decision affirming that AI-generated art without human authorship can’t be copyrighted. The latest report from the U.S. Copyright Office on this topic is here. Additionally, Anthropic and Databricks signed a $100M deal to collaborate on the sale of AI products, specifically agents. See from WSJ, and Anthropic & Databricks.

[5] 🕵️Microsoft is rolling out new “deep reasoning” AI agents—Researcher and Analyst—for Microsoft 365 Copilot, designed to handle complex tasks like multi-step research and advanced data analysis. The researcher taps into OpenAI’s deep research models and third-party platforms like Salesforce, while the Analyst uses OpenAI’s o3-mini model for chain-of-thought reasoning, and data transformation. Both tools, launching in April via early access, aim to bring near-data scientist capabilities to business users. Reported by The Verge.

Founder’s Corner

Lessons from Uber, Founding Missteps, and the Real Moats in the AI Era

What We Read and Watched This Week

  • Bill Gates said AI will replace many jobs, including some teachers and doctors within 10 years. (CNBC)

  • Napster has been sold to Infinite Reality for $207M to become a social, immersive music platform for artists. (The Guardian)

  • Delaware passed a law favoring controlling shareholders, aiming to keep businesses like Elon Musk’s Tesla from reincorporating elsewhere. (WSJ)

  • Boeing secured the $50B Pentagon contract for the F-47 fighter, gaining profit protection amid years of financial struggles. (WSJ)

  • Watch: Ares' co-head of credit Michael Smith says Trump-era policies are pressuring middle-market businesses, impacting workforce and credit outlook. (WSJ Video)

  • The Trump administration cut 20,000 HHS jobs, halved divisions, and created a new health agency in a major overhaul. (NPR)

  • President Trump pardoned Nikola founder Trevor Milton, erasing fraud conviction tied to electric truck startup collapse. (CNBC)

  • For the first time, the DOGE Team sits down for a live interview. Watch the full 30-minute clip here. (YouTube)

AI M&A and Fundraising news (Mar 21 — Mar 27)

  • ai|coustics: Berlin-based speech enhancement startup, raised $5.4M Seed.

  • Automaise: AI agents for customer service, raised a $5.4M Series A.

  • Browser Use: AI browser automation, raised $17M Seed.

  • Brisk Teaching: AI assistant for teachers, raised a $15M Series A.

  • Charm Security: AI-powered scam expert to discover, protect, and disrupt scams in real-time, raised a $8M Seed.

  • Contoro Robotics: AI-powered trailer and container unloading robots, raised a $12M Series A.

  • Differential Bio: AI-based modeling to optimize how industry-relevant microbes grow and produce, raised a $2.1M Pre-Seed.

  • Dyna Robotics: Task-specific robotic systems, raised $23.5M Seed.

  • FERASET: AI consumer apps studio, raised a $4.5M Seed.

  • GetReal: Synthetic media detection, raised a $17.5M Series A.

  • Hook: AI to remix songs from top musicians, raised $3M.

  • Liquid: AI-powered data room & due diligence, raised a $1.5M Pre-Seed.

  • Lumber: AI-powered construction workforce management platform, raised a $15.5M Series A.

  • Lumi AI: Natural language data querying for supply chains, raised a $3.7M Seed.

  • Nace AI: AI for Compliance & audit, raised a $5M Seed.

  • Navina: AI-powered clinical insights, raised a $55M Series C.

  • n8n: AI-powered workflow automation for technical teams, raised a $59M Series B.

  • Nexthop AI: AI networking infrastructure for hyperscale cloud providers, raised a $110M Series A.

  • Nvidia is reportedly in talks to acquire Lepton AI, who raised a $11M Seed in 2023.

  • Mako AI: AI private equity associate, raised a $1.55M Seed.

  • Paid: Billing for AI agents, raised a $10.8M Seed.

  • Reducto: AI to turn PDFs and spreadsheets into data LLMs can use, raised a $8.4M Seed.

  • Silna Health: Administrative automation for healthcare providers, raised $27M.

  • SplxAI: Security testing for agentic systems, raised a $7M Seed.

  • StackGen: AI to auto-generate infrastructure from code, raised a $12.3M Seed.

  • StrongRoom AI: Medication management software startup, raised $17M.

  • Sympera AI: AI agents for relationship banking, raised a $10M Seed.